1120-F Schedule M- Reconciliation of Income (Loss) and Analysis of Unapprop

U.S. Business Income Tax Return

f1120-f_schedule_m-1_and_schedule_m-2--2021-00-00_draft

U. S. Business Income Tax Return

OMB: 1545-0123

Document [pdf]
Download: pdf | pdf
Note: The draft you are looking for begins on the next page.

Caution: DRAFT—NOT FOR FILING
This is an early release draft of an IRS tax form, instructions, or publication,
which the IRS is providing for your information. Do not file draft forms and do
not rely on draft forms, instructions, and publications for filing. We do not
release draft forms until we believe we have incorporated all changes (except
when explicitly stated on this coversheet). However, unexpected issues
occasionally arise, or legislation is passed—in this case, we will post a new draft
of the form to alert users that changes were made to the previously posted draft.
Thus, there are never any changes to the last posted draft of a form and the
final revision of the form. Forms and instructions generally are subject to OMB
approval before they can be officially released, so we post only drafts of them
until they are approved. Drafts of instructions and publications usually have
some changes before their final release.
Early release drafts are at IRS.gov/DraftForms and remain there after the
final release is posted at IRS.gov/LatestForms. All information about all forms,
instructions, and pubs is at IRS.gov/Forms.
Almost every form and publication has a page on IRS.gov with a friendly
shortcut. For example, the Form 1040 page is at IRS.gov/Form1040; the Pub.
501 page is at IRS.gov/Pub501; the Form W-4 page is at IRS.gov/W4; and the
Schedule A (Form 1040/SR) page is at IRS.gov/ScheduleA. If typing in a link
above instead of clicking on it, be sure to type the link into the address bar of
your browser, not a Search box.
If you wish, you can submit comments to the IRS about draft or final forms,
instructions, or publications at IRS.gov/FormsComments. We cannot respond to
all comments due to the high volume we receive and may not be able to
consider many suggestions until the subsequent revision of the product.
If you have comments on reducing paperwork and respondent (filer) burden,
with respect to draft or final forms, please respond to the relevant information
collection through the Federal Register process; for more info, click here.

Reconciliation of Income (Loss) and Analysis of
Unappropriated Retained Earnings per Books

SCHEDULES M-1 and M-2

(Form 1120-F)

▶

Department of the Treasury
Internal Revenue Service

2021

Go to www.irs.gov/Form1120F for the latest information.
▶ Attach to Form 1120-F.

Employer identification number

Name of corporation

Reconciliation of Income (Loss) per Books With Income per Return
Note: The corporation may be required to file Schedule M-3 (see instructions).

DRAFT AS OF
July 13, 2021
DO NOT FILE

Schedule M-1
1
2
3
4

OMB No. 1545-0123

7

Net income (loss) per books . . . . .
Federal income tax per books . . . .
Excess of capital losses over capital gains
Income subject to tax not recorded on
books this year (itemize):

Income recorded on books this year
not included on this return (itemize):
a Tax-exempt interest $
b Other (itemize):

8

5

Deductions on this return not charged
against book income this year (itemize):
a Depreciation . . $
b Charitable contributions $
c Other (itemize):

Expenses recorded on books this year not
deducted on this return (itemize):
a Depreciation . . . .
$
b Charitable contributions $
c Travel and entertainment $
d Other (itemize):

6

Add lines 1 through 5 .

Schedule M-2
1
2
3

4

.

.

.

.

.

.

9
10

Add lines 7 and 8 . . . .
Income—line 6 less line 9 .

.
.

.
.

.
.

.
.
.

.
.
.

6

a Cash . .
b Stock . .
c Property .
Other decreases (itemize):

7
8

Add lines 5 and 6 . . . . . . .
Balance at end of year (line 4 less line 7)

Analysis of Unappropriated Retained Earnings per Books

Balance at beginning of year
Net income (loss) per books .
Other increases (itemize):

Add lines 1, 2, and 3 .

.

.

.
.

.

Who Must File
Generally, any foreign corporation that is
required to complete Form 1120-F,
Section II must complete Schedules M-1
and M-2 (Form 1120-F). However, the
following rules apply.
Do not complete Schedules M-1, M-2,
and M-3 if total assets at the end of the
tax year (Schedule L, line 17, column (d))
are less than $25,000.
Complete Schedule M-3 in lieu of
Schedule M-1 if total assets at the end
of the tax year that are reportable on
Schedule L are $10 million or more.
A corporation filing Form 1120-F that
is not required to file Schedule M-3 may
voluntarily file Schedule M-3 instead of
Schedule M-1. See the Instructions for
Schedule M-3 (Form 1120-F) for more
information.
Foreign corporations that (a) are
required to file a Schedule M-3 (Form
1120-F) and have less than $50 million in
total assets at the end of the tax year, or
(b) are not required to file a Schedule
M-3 (Form 1120-F) and voluntarily file a
Schedule M-3 (Form 1120-F) must either
(1) complete Schedule M-3 (Form 1120-F)
entirely, or (2) complete Schedule M-3
(Form 1120-F) through Part I and
complete Schedule M-1 instead of

.
.

.

.
.

.

.
.

.

5

Distributions:

completing Parts II and III of Schedule
M-3 (Form 1120-F). If the foreign
corporation chooses (2), then Schedule
M-1, line 1 must equal Schedule M-3
(Form 1120-F), Part I, line 11. See the
Instructions for Schedule M-3 (Form
1120-F) for more information.
Note: If Schedule M-3 is completed in
lieu of Schedule M-1, the corporation is
still required to complete Schedule M-2.

Specific Instructions
Schedule M-1
Line 1. Net income (loss) per books.
The foreign corporation must report on
line 1 of Schedule M-1 the net income
(loss) per the set(s) of books taken into
account on Schedule L.
Line 5c. Travel and entertainment
expenses. Include any of the following.
• Entertainment expenses not deductible
under section 274(a).
• Meal expenses not deductible under
section 274(n).
• Expenses for the use of an
entertainment facility.
• The part of business gifts over $25.
• Expenses of an individual over $2,000
that are allocable to conventions on
cruise ships.

For Paperwork Reduction Act Notice, see the Instructions for Form 1120-F.

Cat. No. 49678K

• Employee achievement awards of nontangible property or of tangible property
if the value is over $400 ($1,600 if part of
a qualified plan).
• The part of luxury water travel expenses
not deductible under section 274(m).
• Expenses for travel as a form of
education.
• Other nondeductible travel and
entertainment expenses.
Line 7a. Tax-exempt interest. Report
any tax-exempt interest received or
accrued, including any exempt-interest
dividends received as a shareholder in a
mutual fund or other regulated
investment company. Also report this
same amount in item P at the top of
page 2 of Form 1120-F.

Schedule M-2
Line 1. Beginning balance of
unappropriated retained earnings.
Enter the beginning balance of
unappropriated retained earnings per the
set(s) of books taken into account on
Schedule L.
Note: For additional information for
Schedule M-2 reporting, see the
Instructions for Schedule M-3 (Form
1120-F).
Schedules M-1 and M-2 (Form 1120-F) 2021


File Typeapplication/pdf
File Title2021 Schedules M-1 and M-2 (Form 1120-F)
SubjectReconciliation of Income (Loss) and Analysis of Unappropriated Retained Earnings per Books
AuthorSE:W:CAR:MP
File Modified2021-07-13
File Created2021-07-09

© 2024 OMB.report | Privacy Policy